# More troubles on the farm: Global fertilizer markets seize up after China, Russia keep theirs at h Source: https://www.youtube.com/watch?v=_JEkGd-Xh1U Recap page: https://rapidrecap.app/video/_JEkGd-Xh1U Generated: 2025-12-03T15:05:56.985+00:00 --- ## Quick Overview Global fertilizer markets are seizing up due to export restrictions by China and geopolitical tensions involving Russia and Ukraine, which is forcing US and European farmers to pay dramatically higher prices for essential inputs like potash, urea, and phosphate, making farming costlier and threatening food inflation. **Key Points:** - China halted exports of urea and DAP (Diammonium Phosphate) in October to secure domestic supply, mirroring earlier export controls on rare-earth elements. - US fertilizer imports are significant, with 25% of fertilizer use imported in 2024; for potash, 50% is imported, primarily from Canada (95%), while nitrogen fertilizer imports rely 18% on foreign sources, and phosphate relies 13% on imports (Middle East dominating). - The World Bank noted that Russia and Belarus are top global suppliers of nitrogen, phosphate, and potash, but EU sanctions are forcing them to reroute supplies, tightening availability. - The cost of feeding crops (World Bank fertilizer price index) surged, peaking in early 2022 and remaining elevated, with potash rising due to trade policy risks. - In the US, fertilizer accounts for 18% of production costs for soybeans and around 35% for wheat and corn, acting as a key cost driver for farmers. - US domestic suppliers are raising prices to meet global demand, with Gulf DAP reaching $764.96 USD per metric ton for Oct 2025, and US phosphate producers having one of their best years ever. - Rising fertilizer costs, alongside increases in farm labor, interest, rent, and property taxes (all projected to rise in 2025), create significant budgeting challenges for farmers. ![Screenshot at 0:04: The speaker, Kevin Walmsley in Kunming, China, introduces the topic by noting how trade wars exposed reliance on North American, European, and BRICS countries for raw material inputs.](https://ss.rapidrecap.app/screens/_JEkGd-Xh1U/00-00-04.png) **Context:** The video provides an analysis of the global fertilizer market turmoil, driven by supply restrictions from major exporters like China and the geopolitical fallout from the Russia-Ukraine conflict impacting Russian and Belarusian exports to Europe. This situation directly affects Western farmers, particularly in the US and Europe, who rely heavily on imported fertilizers for crop production, leading to soaring input costs and concerns about future food inflation. ## Detailed Analysis The video concludes that global fertilizer markets are seizing up, leading to significantly higher input costs for farmers, especially in the US and Europe. China stopped exporting urea and DAP in October to secure domestic supply, a move that shakes the international market in the same way its rare-earth element controls did. Data shows that 25% of US fertilizer use in 2024 is imported; for instance, 50% of potash used is imported, mostly from Canada (95%). Nitrogen fertilizer relies 18% on imports, and phosphate 13%, heavily from the Middle East. Compounding this, the EU has imposed sanctions and tariffs on fertilizer imports from Russia and Belarus, who are key suppliers of nitrogen, phosphate, and potash. Russia has rerouted supply to markets like Brazil and India, but Ukraine’s production has been severely disrupted. The World Bank noted that switching suppliers is difficult and costly. The World Bank fertilizer price index spiked significantly, reaching levels over three times higher than in 2020, and although prices have slightly retreated from peaks, they are climbing again, especially for phosphate and potash due to trade policy risks. For US farmers, fertilizer accounts for 18% of soybean costs and 35% of wheat and corn costs, making it a major cost driver. Domestic US suppliers are capitalizing, with Gulf DAP prices rising sharply to over $764 per ton for October 2025. The overall picture is of increasing production costs for farmers globally, who face uncertainty in budgeting for the next planting season. ### Trade War and Supply Reliance - Trade wars exposed reliance on North American, European, and BRICS factories for raw material inputs - Buyers must pay high tariffs or go without, as there are no substitutes at lower prices in their own markets. ### US Fertilizer Import Dependency (2024 Forecast) - Potassium: 50% imported (Canada 95%) - Nitrogen: 18% imported (Canada 46%, Morocco 36%) - Phosphate: 13% imported (Middle East dominates source share). ### Fertilizer Price Volatility - World Bank fertilizer price index rose sharply post-2020, peaking near 300 in early 2022, then dipped but is currently rising again - DAP prices reached $764.96 USD/MT for Oct 2025, up from $76.50 a year ago. ### Geopolitical Supply Constraints - China halted exports of urea and DAP in October - EU imposed sanctions on Russian/Belarusian fertilizer imports (Russia accounts for 25% of EU's imports) - Russia is rerouting supply, but Ukraine's production is disrupted. ### Impact on Farming Costs - Fertilizer is a key cost driver, accounting for 18% of US soybean costs and 35% of US wheat/corn costs - Other expenses like labor, interest, rent, and property taxes are also projected to rise significantly in 2025, adding pressure to farm budgets. ![Screenshot at 0:04: Kevin Walmsley introduces the segment 'Inside China Business' from Kunming, China.](https://ss.rapidrecap.app/screens/_JEkGd-Xh1U/00-00-04.png) ![Screenshot at 0:13: An inset YouTube thumbnail shows a previous video discussing who pays the high Trump tariffs, indicating the context of trade disputes.](https://ss.rapidrecap.app/screens/_JEkGd-Xh1U/00-00-13.png) ![Screenshot at 0:40: A news headline overlay stating, 'The US Has Never Imported So Much Food,' highlighting the shift in US agricultural trade balance.](https://ss.rapidrecap.app/screens/_JEkGd-Xh1U/00-00-40.png) ![Screenshot at 0:56: A Bloomberg chart showing the US farm trade deficit growing, projected to hit a record $49 billion in 2025.](https://ss.rapidrecap.app/screens/_JEkGd-Xh1U/00-00-56.png) ![Screenshot at 1:39: A World Bank chart illustrating the sharp rise and subsequent minor dip in the fertilizer price index from 2020 to 2025.](https://ss.rapidrecap.app/screens/_JEkGd-Xh1U/00-01-39.png)